Limited company or personal name: five questions before your next purchase.
Five questions to take to your accountant before you decide how your next rental property should be held.
Limited companies are now a routine part of the conversation about a new buy-to-let. That does not make a company the right answer for every buyer. The companion guide explains the tax and administrative differences. These five questions frame the decision.
This is not tax advice. Use these questions to shape the conversation with your accountant, then let them do the arithmetic on your numbers.
1. Do you expect to keep buying?
An individual landlord cannot deduct residential mortgage interest as an ordinary expense. The current system gives a 20% tax reduction instead. The Finance Act 2026 changes that to the 22% property basic rate from the 2027 to 2028 tax year.
Inside a company, interest is still an ordinary expense. The more properties you add, the more that difference is worth.
2. Are you already a higher or top-rate Scottish taxpayer?
Scottish rental income in the higher-rate band is taxed at 42%, with bands climbing to 48%. Corporation Tax sits between 19% and 25% depending on profit.
Compare your personal tax position with the company's Corporation Tax position, then include the tax due when money leaves the company. Scottish taxpayer status, the tax year and the source of the income all matter. A headline rate comparison is not enough.
3. Do you plan to reinvest rental profits, or draw them as income?
If you leave profits in the company to fund the next purchase, they are taxed at the Corporation Tax rate along the way. If you draw them out to live on, dividend tax lands on top.
Keeping profit in the company can leave more cash available for a deposit than drawing it personally. If you need the rental profit to live on, include the tax cost of extracting it. Ask the accountant to model both cash paths.
4. Do you want to bring in a spouse, a family member or a co-investor?
Shares can be divided or transferred without changing the title to each property. A personally held property needs a conveyance to change its legal owner. Neither route is automatically tax-free, so succession or co-ownership plans need legal and tax advice. If shared ownership or a gradual handover is anywhere in your plan, shares give you room to move.
5. Is your intended hold ten years or more?
A company creates setup, filing and accountancy costs from the first year. A longer hold gives more time for any tax advantage to outweigh those costs. The intended exit also matters, because selling the property and taking the proceeds out of a company can create separate tax charges.
How will you keep the records separate?
If your portfolio already runs on a mix of personal and company ownership, the hardest part is not the tax. It is keeping track of which certificate, which mortgage, which insurance policy and which bank account belongs to which owner.
Lar records the legal owner before the property. Mortgages, transactions, documents and reporting follow that owner, while the portfolio view can still bring the holdings together.
Every SPV, every owner, one view.
Cash flow, debt and yield for each owner, a consolidated view of the lot, and entity-scoped access for your accountant.
Nothing in this guide is tax or legal advice. The right structure depends on your circumstances; take advice from your accountant before committing to a purchase vehicle.